On January 1, 20x1, Popular Creek Corporation organized SunTime Company as a subsidiary in Switzerland with an initial investment cost of Swiss francs (SFr) 69,000. SunTime's December 31, 20X1, trial balance in SFr is as follows: Credit Debit SFr 8,800 23,000 6,500 29,500 100,000 Cash Accounts Receivable (net) Receivable from Popular Creek Inventory Plant & Equipment Accumulated Depreciation Accounts Payable Bonda Payable Common Stock Salem Cost of Goods Sold Depreciation Expense Operating expense Dividenda Paid Total SPE 11,300 12,800 51,000 69,000 16), 800 70,500 11,300 32,500 17,000 BT307,900 Yr 307,900 Additional Information 1. The receivable from Popular Creek is denominated in Swiss francs. Popular Creek's books show a $5,500 payable to SunTime. 2. Purchases of Inventory goods are made evenly during the year. Items in the ending inventory were purchased November 1 3. Equipment is depreciated by the straight-line method with a 10-year life and no residual value. A full year's depreciation is taken in the year of acquisition. The equipment was acquired on March 1. 4. The dividends were declared and paid on November 1. 5. Exchange rates were as follows: SPF $ January 1 1-0.73 March 1 1-0.74 November 1 1 -0.77 December 31 1 -0.80 20x1 average 1 -0.75 6. The Swiss franc is the functional currency. Required: a. Prepare a proof of the translation adjustment POPULAR CREEK CORPORATION AND SUBSIDIARY Proof of Translation Adjustment Year Ended December 31, 20X1 US Dollars Net assets at beginning of year Adjustment for changes in net asset position during year. Net Income for year Dividends paid Net assets translated at: Rates during year Rates at end of year Change in other comprehensive income translation adjustment during year net increase Accumulated other comprehensive income translation adjustment January 1 Change in other comprehensive income translation adjustment December 31 0 0 $ 0 b. Where is the translation adjustment reported on Popular Creek's consolidated financial statements and its foreign subsidiary? (Select all that apply.) DO Cash flow statement Statement of financial position Income statement Statement of comprehensive Income Statement of retained earnings